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Personal Financial Planning (Jump)

Combining the Security of Major Institutions' offerings with the Flexibility of Custom Designed Plans

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Personal Financial Planning

from Ralph Vandervoort

Many of us have been careful to minimize our annual income taxes by seeking competent advice over the years. The fact is when we die we may end up giving much of the tax savings back. For some this may not matter, others may prefer to see their assets go to children, family or charity. About 70% of the wealth in Canada is controlled by people over age 55. Substantial amounts of wealth will be transferred in the next 15-20 years. Both the province and Revenue Canada are continually evaluating ways to get their hands on some of this wealth.

See also my page on Registered Savings Plans for other financial planning opportunities.

Case Study:

A client (early 40's) is the only income earner in the family. Her husband had a serious illness and was disabled. He was staying at home and trying to parent their two children. Her RRSP's are being invested into a spousal segregated fund. At the peak of the recent stock market correction her husband died. At this time the average investment fund was down 20%! This would have been a very painful financial loss in addition to the emotional trauma. However:

  • this fund had a 100% guarantee of all deposits on death (saving the 20.0%).
  • this fund was exempt from probate fees (saving another 1.5%).
  • all values were transferred tax free to her RRSP.